Bases of Apportionment:

In order to ascertain the correct cost of cost centres and cost units, suitable bases
have to be adopted for allocation and apportionment of overhead.
The undermentioned are some of the bases adopted for apportionment of
manufacturing overheads:
(1) Direct Allocation:
Wherever traceable, overheads are to be directly allocated to particular
departments. Examples are power, overtime premium of particular departments.
(2) Labour Hous:
Overheads are apportioned on the basis of direct labour hours of different
departments.
(3) Machine Hours:
Overheads are distributed on the basis of machine hours worked in each
department.
(4) Value of Direct Material Consumed:
This basis is used for apportioning indirect materials and material handling
charges.
(5) Direct Wages:
Direct wages is used as basis to apportion indirect wages and general overheads.
(6) Number of Staff:
Number of employees in each department is taken as basis to apportion
overheads cost incurred for the welfare of workers.
(7) Floor Area of Departments:
The area occupied by different departments is taken as basis to apportion
expenses like rent, property tax, and lighting, heating and building maintenance
expenses.
(8) Capital Values of Assets:
Capital values of assets of different departments is taken as basis to apportion
depreciation, repairs and maintenance, insurance of assets, etc.
(9) Light Points:
The light points of various departments is taken as basis to apportion lighting
expenses.
(10) Kilowatt Hours:
The kilowatt hours of various departments is taken as basis to apportion power
expenses.